Quantifying the Blockchain Trilemma: A Comparative Analysis of Algorand, Ethereum 2.0, and Beyond

ArXiv ID: 2407.14335 “View on arXiv”

Authors: Unknown

Abstract

Blockchain technology is essential for the digital economy and metaverse, supporting applications from decentralized finance to virtual assets. However, its potential is constrained by the “Blockchain Trilemma,” which necessitates balancing decentralization, security, and scalability. This study evaluates and compares two leading proof-of-stake (PoS) systems, Algorand and Ethereum 2.0, against these critical metrics. Our research interprets existing indices to measure decentralization, evaluates scalability through transactional data, and assesses security by identifying potential vulnerabilities. Utilizing real-world data, we analyze each platform’s strategies in a structured manner to understand their effectiveness in addressing trilemma challenges. The findings highlight each platform’s strengths and propose general methodologies for evaluating key blockchain characteristics applicable to other systems. This research advances the understanding of blockchain technologies and their implications for the future digital economy. Data and code are available on GitHub as open source.

Keywords: Blockchain Trilemma, Proof-of-Stake (PoS), Algorand, Ethereum 2.0, Decentralization Metrics, Crypto / Blockchain Assets

Complexity vs Empirical Score

• Math Complexity: 3.0/10
• Empirical Rigor: 7.5/10
• Quadrant: Street Traders
• Why: The paper relies on empirical analysis of real-world on-chain data, with code and datasets available on GitHub, indicating high data/implementation readiness. The mathematics involves established statistical indices (Shannon Entropy, Gini Coefficient) and basic metrics like throughput/latency, without advanced derivations or dense formalism.

  flowchart TD
    A["Research Goal: Evaluate Algorand & Ethereum 2.0 against the Blockchain Trilemma"] --> B["Data Collection & Strategy Definition"]
    B --> C{"Key Methodology: Structured Comparative Analysis"}
    C --> D["Input: Real-world Data<br/>(Transactional & Network Metrics)"]
    C --> E["Input: Existing Indices<br/>(Decentralization/Security)"]
    D & E --> F["Computational Process<br/>Quantitative Metrics & Vulnerability Assessment"]
    F --> G["Key Findings & Outcomes"]
    G --> H["1. Identified Strengths/Weaknesses<br/>of Algorand & Ethereum 2.0"]
    G --> I["2. Proposed General Methodologies<br/>for Evaluating Blockchain Characteristics"]
    G --> J["3. Open Source Data & Code<br/>Available on GitHub"]